How do consumers process and evaluate prices

HOW CONSUMERS INTERPRET PRICES

Price produces Revenue

Factors in making Pricing Decisions

CustomerCompany

Market

Competition

A CHANGING PRICING ENVIRONMENT

Buyers

Can

Instant price comparisonsName their price and have it metGet products free “Giving it All Away”

A CHANGING PRICING ENVIRONMENT

Monitor Customer Behavior

Give special prices

Negotiate prices

Sellers

Can

Consumer Psychology and Pricing

Blue Denims are Blue Denims for both Armani and Levis !!!

Then prices

Differ ???

Reference Prices

Possible Consumer Reference PricesFair Price

Typical Price

User Discounted Price

Last Price Paid

Historical competitor Price

Expected Future Price

Price-Quality Inferences -luxury products

Price Endings

“9”endings suggest a discount or bargain“Sale” sign next to Prices spur demands

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